Equals Group PLC Acquisition of HermexFX (4824I)

TIDMEQLS

RNS Number : 4824I

Equals Group PLC

09 August 2019

9 August 2019

Equals Group plc

("Equals" or "the Group" or "the Company")

Acquisition of trade and assets of HermexFX and subscription for shares in Equals Group Plc

and

Issue of Equity on exercise of Options

Equals Group PLC, the e-banking and international payments group, is pleased to announce that its subsidiary, FairFX plc, has acquired the International Payments business of Hermex International Limited ("HermexFX"), part of the FXPro Group, for a total consideration of GBP2 million, payable in cash on completion (the "Acquisition").

HermexFX offers international payment services to a predominantly corporate client base through a personalised service offering. The Acquisition will complement the Group's strategy to develop its fast-growing corporate segment, providing additional corporate clients and cross-selling opportunities for the expanding range of products through their existing sales channels. The Group's technology, combined with its expertise in compliance, operations and settlements, means the integration of the HermexFX business into the Group can be achieved efficiently.

The Acquisition is made in accordance with the Group's strategy to consolidate smaller, attractive market participants. It is expected to be immediately earnings enhancing. In addition, the Acquisition fits with one of Equals' stated core strategies of extracting value from increasing economies of scale.

Concurrently with the Acquisition, Kyrillos Kyriacou, the current CEO and founder of HermexFX, has joined the Equals Group as an employee and has agreed to subscribe GBP1 million, for 851,063 new ordinary shares of 1p each in the Company ("Subscription Shares") at an issue price of GBP 1.175 per share. The Subscription Shares are subject to a two year lock-in period followed by an orderly market provision.

Furthermore, the Company announces an issue of equity pursuant to a recent exercise of employee share options over 33,333 new ordinary shares of 1p each ("Option Shares").

The Company has applied for the Subscription Shares and Option Shares to be admitted to trading on AIM ("Admission"). It is expected that Admission will take place at 8.00 a.m. on 14 August 2019. Following Admission, the Company will have 165,202,079 ordinary shares of 1p each in issue admitted to trading on AIM. This figure, 165,202,079, may be used by Shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

For the 12 months to 30 June 2019, the subject of the Acquisition generated revenue of GBP1.8 million and would have contributed GBP0.6 million to PBT. As at 30 June 2019, the subject of the Acquisition had gross assets of GBP0.2million (excluding the fair value of intangible assets and goodwill).

Ian Strafford-Taylor, Chief Executive Officer, commented: "This acquisition further demonstrates the ambition of the Group to be a dominant force in the payments market. Utilising our proprietary technology and outstanding operations teams we are able to absorb businesses like HermexFX extremely efficiently. The acquisition also shows our commitment to pursuing our strategy of achieving cost efficiencies through scale. We are delighted to have attracted such a high quality, service-led business with an excellent client base, and we welcome the team from HermexFX to the Equals family."

For more information, please contact:

 
 Equals Group plc                     +44 (0) 20 7778 
  Ian Strafford-Taylor, CEO            9308 
 Cenkos Securities plc - Nominated 
  Advisor and Joint Broker 
 
  Max Hartley (Nomad) 
  Callum Davidson                     +44 (0) 20 7397 
  Nick Searle - Sales                  8900 
 Canaccord Genuity Limited - Joint 
  Broker 
 
  Bobbie Hilliam 
  David Tyrrell                       +44 (0) 20 7523 
  Alex Aylen - Sales                   8150 
 
 
                                        +44 (0) 7747 788 
 Yellow Jersey                          221 
                                        +44 (0) 7796 325 
  Charles Goodwin                       254 
  Joe Burgess                           +44 (0) 7983 557 
  Annabel Atkins                        851

About Equals

Equals is a leading challenger brand in banking and payments that disintermediates the incumbent banks with a superior user experience and low-cost operating model. Our business enables personal and business customers to make easy, low-cost payments both domestically and in a broad range of currencies and across a range of products all via one integrated system. The Equals platform facilitates payments either direct to Bank Accounts or at 35 million merchants and over 1 million ATM's in a broad range of countries globally via Mobile apps, the Internet, SMS, wire transfer and MasterCard/VISA debit cards.

Equals provides money movement services to both personal and business customers through four channels: Currency Cards, Physical Currency, International Payments and Bank Accounts. The Currency Card and Physical Currency offerings facilitate multiple overseas payments at points of sale and ATM's whereas the International Payments channel supports wire transfer foreign exchange transactions direct to Bank Accounts. For Corporates, Equals has a market-leading business-expenses solution based around its corporate platform and prepaid card. This service can yield significant savings on a Corporate's expenses and procurement both domestically and overseas, through better controls and improved transparency. The platform also streamlines the downstream administrative processes and integrates into accounting software, thus saving costs. Equals offers retail and business bank accounts with all the functionality you would expect from a bank, namely faster payments, BACs, direct debits, international payments and a debit card.

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